| Some Definitions about Day-Trading / Part 4 |
| About INDICES ! |
| RUSSELL 2000 |
| ==) Symbol Futures : RL.... |
Overview
Started in 1984, the Russell 2000 Index is a subset of the larger Russell 3000. It is one of the most widely used indexes by investors and is generally accepted as
the benchmark for small-cap firms. It includes many newer, smaller firms that are not represented by the S&P 500 or other large indexes.
Composition
The Russell 2000 Index contains the smallest 2000 stocks (based on market cap) held by the Russell 3000. Though it contains twice as many stocks as the
large-cap Russell 1000, because of their small average size, its component stocks account for just 7% of the value of all U.S. equities. The index is computed based
on a market cap weighting, meaning that the largest stocks have the greatest influence on the index's returns. The Russell 200 Index is more evenly weighted than
most, as the top 10 holdings represent less than 2% of the index's overall value. The average firm carries a market cap of just under $1 billion, and most stocks
within the index range in size from roughly $100 million to $2 billion.
Started in 1984, the Russell 2000 Index is a subset of the larger Russell 3000. It is one of the most widely used indexes by investors and is generally accepted as
the benchmark for small-cap firms. It includes many newer, smaller firms that are not represented by the S&P 500 or other large indexes.
Composition
The Russell 2000 Index contains the smallest 2000 stocks (based on market cap) held by the Russell 3000. Though it contains twice as many stocks as the
large-cap Russell 1000, because of their small average size, its component stocks account for just 7% of the value of all U.S. equities. The index is computed based
on a market cap weighting, meaning that the largest stocks have the greatest influence on the index's returns. The Russell 200 Index is more evenly weighted than
most, as the top 10 holdings represent less than 2% of the index's overall value. The average firm carries a market cap of just under $1 billion, and most stocks
within the index range in size from roughly $100 million to $2 billion.
Microsoft -- MSFT-- 9 %
Intel -- INTC -- 5.9 %
Cisco Systems -- CSCO -- 5.4 %
Dell -- DELL -- 2.9 %
Amgen -- AMGN -- 2.5 %
Oracle -- ORCL -- 2.1 %
Qualcomm -- QCOM -- 1.8 %
eBay -- EBAY -- 1.5 %
Comcast -- CMCSA -- 1.3 %
Amat -- AMAT -- 1.2 %
Intel -- INTC -- 5.9 %
Cisco Systems -- CSCO -- 5.4 %
Dell -- DELL -- 2.9 %
Amgen -- AMGN -- 2.5 %
Oracle -- ORCL -- 2.1 %
Qualcomm -- QCOM -- 1.8 %
eBay -- EBAY -- 1.5 %
Comcast -- CMCSA -- 1.3 %
Amat -- AMAT -- 1.2 %
Positives
The Russell 2000 is the most widely recognized index for small-cap stocks. Though the index contains smaller, more volatile companies, the Russell 2000 has
handily outperformed its large-cap peers since its inception. Because of its size and popularity, liquidity and trading costs are not a large concern--many investors
actively trade this index.
Drawbacks
Though it contains a larger number of stocks when compared to the S&P SmallCap 600 Index, many investors are beginning to question whether the Russell 2000
is really a better gauge of the universe of small-cap stocks. The smaller S&P 600 quietly gained a large following thanks in large part to its historical
out-performance relative to the Russell 2000.
How can I trade/invest in this index ?
Investors can invest in the Russell 2000 Index via a multitude of different futures, options, mutual fund and ETF's. Trading costs are generally higher for small-cap
stocks.
The Russell 2000 is the most widely recognized index for small-cap stocks. Though the index contains smaller, more volatile companies, the Russell 2000 has
handily outperformed its large-cap peers since its inception. Because of its size and popularity, liquidity and trading costs are not a large concern--many investors
actively trade this index.
Drawbacks
Though it contains a larger number of stocks when compared to the S&P SmallCap 600 Index, many investors are beginning to question whether the Russell 2000
is really a better gauge of the universe of small-cap stocks. The smaller S&P 600 quietly gained a large following thanks in large part to its historical
out-performance relative to the Russell 2000.
How can I trade/invest in this index ?
Investors can invest in the Russell 2000 Index via a multitude of different futures, options, mutual fund and ETF's. Trading costs are generally higher for small-cap
stocks.
Trader : Herman Bogaerts -- Tradersname : Freedom --- Portable : 0033.(0).683.13.99.99
E-Mail : Herman.Bogaerts@Wanadoo.fr --- Herman_Bogaerts@Yahoo.com
E-Mail : Herman.Bogaerts@Wanadoo.fr --- Herman_Bogaerts@Yahoo.com
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